CHANCELLOR Clarke's budget is one more step on the road of destroying the welfare state. It is also a ferocious attack on the living standards of employed workers. The sheer scale of what this means can be seen in the following list:
• Unemployment benefit will be cut to just six months within two years. Hundreds of thousands of long-term unemployed will be forced to rely on other benefits which pay less. The unemployed will have to sign a job seekers agreement' aimed at pushing workers into jobs with poverty wages.
• Through the new 'incapacity benefit' and stricter medical guidelines, tens of thousands of people with disabilities will have benefit totally withdrawn.
• A public sector wage freeze will be imposed for three years, in a period when inflation is bound to rise.
• Pensioners will get a derisory 50p a week, or 70p for couples, to cover the VAT on domestic fuel. Pensions will rise a spectacular £1.30 or £1.85 for a couple.
• Local authority cash will decline next year by 3 per cent in real terms- from what is already a catastrophic level. This means more redundancies, cuts and a pay freeze for local government workers. The council tax - the poll tax by stealth - will rise by at least 7 per cent on average next April.
• Because of the council cash freeze, money for primary and secondary education will decline 2-3 per cent in the next year: this means a worsening service and more teachers sacked, as well as a pay freeze.
• Money for housing will be cut by at least £150m: this means more homeless and a further decline in the already devastated construction industry.
• Raising women's retirement age to 65 by 2020 is a huge social step backwards, robbing workers of benefits they have paid for.
• Tax increases - on mortgages, insurance and through not raising personal allowances in line with inflation means worsening the living standards of every employed worker.
• Government spending will be reduced by billions in the next five years -meaning less investment in infrastructure and more attacks on the welfare state to come.
• To add vicious insult to injury, student grants are being reduced (!) by 10 per cent The budget changes have to be put together, with plans to abolish state sickness benefit and to phase out state pensions at any significant level.
What does all this add up to? The Tories' aim is simply to destroy the welfare state in any recognisable form. This is a long-term process, but the speed of its implementation is drastically accelerating, The privatisation of social welfare is those hundreds of thousands deprived of invalidity benefit or pushed off the dole?
Their families will have to support them, or they will be totally impoverished. 'Impoverished' in this context means losing their homes and being pushed onto the street.
But more than that, Clarke's budget is a budget for slump. It is shot through with chronic social irrationality.
Take transport. It is just one example, but an instructive one. Cars owners have to pay more through petrol tax, motorway tolls and road tax. But public transport is in crisis because of lack of investment. People in rural areas are compelled to use Cas unusuno rave At the same time, existing public transport is collapsing. The London Tube is in appalling crisis, with tens of thousands stuck in tunnels for hours last week, and the Central Line at a standstill for six days "Those who say that a radical socialist programme is impossible have to explain why it is an immutable fact of life that society has to have people with huge personal fortunes while which prioritises profits over social need." after 50-year old wiring failed.
So the net result of government policy is more, and hugely costly, car transport; with public transport becoming ever worse and more expensive.
At the root of the government spending crisis is economic recession and mass unemployment. The Tories accept these things as a fact of life and are adjusting the welfare state accordingly.
What is being prepared is a society where employed workers struggle to keep their heads above water, under a permanent threat of unemployment; and where there is a mass of permanently unemployed, or occasionally employed, workers who are pauperised. In this society the old, the sick and those with disabilities will go to the The response of the Labour leadership bleating about broken tax promises, is pathetic. Labour is hamstrung by its own Commission on Social Justice' which accepts the principle of abolishing universal social benefits in favour of means testing - in other words, concedes the principal Tory argument about 'selfhelp'.
Labour is also hamstrung by 'Gordon Brown economics', the chronic fear of being seen as the high tax, high spending party.
There is only one way out of this crisis which serves social justice and the interests of the working class: tax the rich! Tory policies have handed tax concessions worth over f20 billion to top earners since 1988 - almost half the present public spending deficit.
It is no accident that share prices shot up the day after the budget; big business and the City know that workers are again being made to pay the price of the crisis, and that profiteers are speculators are still being protected.
But it's not just a question of sharing out the existing wealth more equally: the capitalist system is now clearly acting to obstruct the development of productive forces that could solve the problems of world hunger, homelessness and unemployment.
Austerity and unemployment for ordinary people are not fixed facts of life, they are manufactured by the system. Under capitalism, private profit is the only driving force: social need is at best a secondary factor in the key economic and financial decisions made by big business and capitalist governments..
Only under socialism, in which ownBe ership and control are taken from the hands of the capitalist class, can production be planned and geared to social need.
Radical measures
There is an alternative to the Tory austerity drive, but it calls for radical socialist measures.
The following simple proposals would create millions of jobs, and change the face of Britain:
• A national programme of public works, concentrating on house building and renewal of the infrastructure, to create thousands of new jobs.
• A national minimum wage of £200 a week, with social security benefits and pensions based on this level.
• A huge programme of investment in industry, health and transport to regenerate economic growth.
• New investment in local government services, including education and social services.
• The reduction of the working week to 30 hours, without loss of pay, to create new jobs.
Unrealistic? It's a myth that the resources for such proposals don't exist. They exist in the huge profits of the financial institutions, in the vast unearned incomes from foreign investment, the monstrous wasted resources spent on arms programmes and 'defence'.
To carry them through would mean bringing the banks, financial institutions and major industry under social control; it would mean slashing the defence budget; it would mean huge taxes on the fortunes of the super-rich and the top 10 per cent of very wealthy people in Britain.
Those who say that a radical socialist programme is impossible have to explain why it is an immutable fact of life that society has to have people with huge personal fortunes while thousands live in the streets.
We only 'have to' have these things so long as we have a society which prioritises profits over social need.
No friends of SOCIALIST OUTLOOK No. 54, December 11 1993, Page 4
thousands live in the streets. We only 'have to' have these things so long as we have a society